cash per share after tax

When I woke up this morning I realised that some of the tax has already been paid.

Remember the profit HGO declared? That was entirely due to HGO making 'fair value adjustments' to its ESG holding.

So check out the half year report. ESG was revalued at $77.3m. So it would seem the tax payable would be ($176m-$77.3m x 30%) = $29.61m, which, this being transacted in fy 200910, wouldn't be payable until 2011...

Add to that HGO still have exploratiojn expenditure (a tax offset) of $37.7m (value at 30% is $11.31m) to offset against that $29.6m tax liability.

So I think the net tax owing on the $176m amount will be around $18.3m.

So my best guess is that HGO will, after the income expense, have $155.7m cash (in addition to the cash they have already).

That net cash after tax of 37.8 cent per share

Plus Kanmantoo, current cash, and other assets

AND PLUS a takeover premium. (my valuation adds AT LEAST another $1.00 per ESG share, or another $176m (add another 30 cents after tax to HGO).

HGO will still be undervalued today, as it was yesterday.

Remember QCG. Don't sell at the first bid! The $1.00 is just a 'downpayment' and HGO know it!

The FINAL and HIGHEST bid for ESG wins, not the first.

Y